🔗 Share this article

Nvidia has become the world's first $5 trillion firm, only three months following the Silicon Valley chipmaker first broke through the $4 trillion market value barrier.

In comparison, Nvidia’s worth exceeds the GDP of India, Japan and the United Kingdom, as reported by the International Monetary Fund (IMF).

Shortly after American exchanges opened this Wednesday, Nvidia’s shares reached $207.86 with 24.3bn shares outstanding, placing its market cap at $5.05 trillion.

Strong demand for Nvidia’s chips, regarded as the most cutting edge in driving artificial intelligence products and software, is the primary driver that the company’s stock price has increased so rapidly from the start of last year.

The wider US stock market has reached new peaks this week, supported by massive funding in artificial intelligence.

Major Announcements and Partnerships

Earlier this week, Nvidia’s Chief Executive, Jensen Huang, disclosed $500 billion in processor contracts.

Nvidia also announced a collaboration with the ride-hailing service on autonomous taxis and a $1 billion funding in Nokia, with the parties aiming to cooperate on 6G technology.

Furthermore, Nvidia is teaming with the American energy agency to construct multiple advanced computing systems.

Recently, Nvidia announced that it will commit $100bn in an AI research organization as part of a joint effort that will include at least 10 gigawatts of AI computing facilities to boost the computing power for the developer of the AI assistant ChatGPT.

In August, Huang mentioned Nvidia was discussing a prospective processor designed for China with the Trump administration.

Donald Trump said aboard his plane that he would discuss with the Chinese president, Xi Jinping, about Nvidia’s technology on Thursday.

Tech Surge and Market Impact

Hitting the new benchmark highlights the upheaval caused by an artificial intelligence craze that is widely viewed as the most significant change in the tech sector after the Apple co-founder Steve Jobs unveiled the original smartphone nearly two decades back.

Apple capitalized on the iPhone’s success to emerge as the first publicly traded company to be valued at $1 trillion, $2tn and eventually, $3 trillion.

Risks and Warnings

But there are concerns of a potential tech bubble, with officials at the Bank of England recently flagging the increasing danger that tech stock prices driven by the AI boom could burst.

IMF’s managing director has issued comparable warnings.